PERA FAQ

Content
I. Introduction to PERA (Page 1 to 4)
II. BPI PERA (Page 5 onwards)

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I. Introduction to PERA

1. What is the objective of PERA?

PERA’s objective is to promote capital market development and savings
mobilization, to contribute to long-term fiscal sustainability through the provision of
long-term financing, and to reduce the need for social pension benefits.

2. Who are the parties to a PERA?

There are 4 parties to a PERA, namely:
● Contributor (client)
● Administrator*
● Investment Manager (optional party)
● Custodian** - ( can be a Cash Custodian or Securities Custodian).

*As of Jan 1, 2017, only BPI and BDO have been pre-qualified by BSP and accredited
by BIR to act as PERA Administrators. ** As of Jan 1, 2017, only Land Bank has been
accredited to act as a Cash Custodian

3. What is a Contributor?
A Contributor is a natural person who:
Establishes and contributes to a PERA 2. Has a Tax Identification Number (TIN) 3. Has
the capacity to contract

4. What is a PERA Administrator?

A PERA Administrator is an entity which has been pre-qualified by the concerned
Regulatory Authority (BSP, SEC or IC) and accredited by the Bureau of Internal

BPI Asset Management and Trust Corporation (BPI AMTC) is a subsidiary of the Bank of the Philippine Islands. For any inquiries and
complaints relating to our services and product, you may call us at (02) 8580-AMTC (2682), send an email
to [email protected], or write a letter addressed to BPI Asset Management and Trust Corporation - Consumer
Protection, 7/F BPI Buendia Center, Sen. Gil J. Puyat Avenue, Makati City 1209.

BPI AMTC as Trustee and Investment Manager is regulated by the Bangko Sentral ng Pilipinas with email
address [email protected].
Revenue (BIR), and is responsible for administering and overseeing the PERA of the
Contributor. Only BPI and BDO have been pre-qualified by the BSP and accredited
by the BIR.

5. What is an Investment Manager?

An Investment Manager is a regulated entity accredited by the concerned
Regulatory Authority (BSP, SEC or IC), that is authorized by the Contributor to make
investment decisions for his PERA.

6. What is a Custodian?
A Custodian is a separate and distinct entity unrelated to the Administrator,
accredited by the BSP to take custody of PERA assets.
There are two types of Custodian:
● Cash Custodian – shall maintain custody of all funds in connection with
PERA.
● Securities Custodian – shall maintain custody of all securities, evidence
of deposits or other evidence of investment

7. How much can a Contributor invest in a PERA per year?

The maximum total contributor’s PERA per calendar year should not exceed PHP
100,000 per year for non-OFs or PHP 200,000 per year for Overseas Filipinos.

8. Can a Contributor invest in different PERA products?

Yes. PERA Contributors who have opened their PERA, a PERA Administrator, can
invest in PERA products such as UITFs, Mutual Funds, insurance pension products,
government securities, stocks, etc. as long as these have been accredited by their
respective regulators.

However, remember that each PERA Contributor can only contribute to a maximum
total of PHP 100,000 or PHP 200,000 if he/she is an Overseas Filipino per calendar
year regardless of the number of PERA products he/she is invested in.

9. Can a Contributor contribute more than the PHP 100K or 200K?

Contributions exceeding the allowed qualified contribution limits will not be
accepted by the Administrator under the PERA account.

BPI Asset Management and Trust Corporation (BPI AMTC) is a subsidiary of the Bank of the Philippine Islands. For any inquiries and
complaints relating to our services and product, you may call us at (02) 8580-AMTC (2682), send an email
to [email protected], or write a letter addressed to BPI Asset Management and Trust Corporation - Consumer
Protection, 7/F BPI Buendia Center, Sen. Gil J. Puyat Avenue, Makati City 1209.

BPI AMTC as Trustee and Investment Manager is regulated by the Bangko Sentral ng Pilipinas with email
address [email protected].
 10. Can an employer contribute on behalf of an employee?
Yes, an employer may contribute on behalf of an employee up to the extent
allowable to the Contributor. However, the contribution to the employee’s PERA is
in addition to, and not in lieu of the employer’s contribution to the SSS and its
obligation to pay retirement benefits to its employees under the Labor Code.

11. What are the benefits of an employer who contributes to his employees
PERA?

On the part of the employer:

● the employer can claim the actual amount of Qualified Employer’s
Contribution as a deduction to his gross income but only to the extent
of the employer’s contribution that would complete the maximum
allowable PERA contribution of an employee
● It shall likewise be exempt from withholding tax on compensation

On the part of the employee:

● the Qualified Employer’s contribution to the employee’s PERA shall not
form part of the employee’s taxable gross income, hence, exempted
from the withholding tax on income (compensation or fringe benefits)

12. What are the tax incentives under PERA?

5% Tax Credit
Qualified Contributors shall be entitled to a tax credit in the amount of five
percent (5%) of the aggregate Qualified PERA contributions made in one
calendar year

For non-OFs, they shall be issued a Certificate of Entitlement to 5% tax credit.

For self- employed Qualified Contributors, they shall be issued a PERA TCC by
the BIR. The entitlement to 5% tax credit shall be allowed to be credited only
against the Contributor’s income tax liability.

For OFs, they shall be entitled to claim the 5% tax credit against any national
internal revenue tax liabilities (excluding the Contributor’s withholding tax
liabilities as withholding agent)

BPI Asset Management and Trust Corporation (BPI AMTC) is a subsidiary of the Bank of the Philippine Islands. For any inquiries and
complaints relating to our services and product, you may call us at (02) 8580-AMTC (2682), send an email
to [email protected], or write a letter addressed to BPI Asset Management and Trust Corporation - Consumer
Protection, 7/F BPI Buendia Center, Sen. Gil J. Puyat Avenue, Makati City 1209.

BPI AMTC as Trustee and Investment Manager is regulated by the Bangko Sentral ng Pilipinas with email
address [email protected].
 Tax Exempt Investment Income
Investment income of the contributor consisting of all income earned from
investments and reinvestments of his PERA assets in the maximum amount
allowed is exempt from the following taxes:
● The final withholding tax on interest from any currency bank deposit,
yield or any other monetary benefit from deposit substitutes and from
trust funds, including depository bank under the expanded foreign
currency deposit system
● The capital gains tax on the sale, exchange, retirement or maturity of
bonds, debentures or other certificate of indebtedness
● The 10% tax on cash and/or property actually or constructively received
from a domestic corporation, including a mutual fund company
● The capital gains tax on the sale, barter, exchange or other disposition
of shares of stock in domestic corporation
● Regular income tax

Other Tax Incentives

● For Qualified Distributions made upon reaching 55 & 5, it is excluded
from the gross income of the contributor and it is also not subject to
income tax
● For Qualified Distributions made upon the death of the contributor, it
will be excluded from the gross income of the heirs or beneficiaries and
not subject to estate tax.

13. What is a Qualified PERA Distribution?

Qualified Distribution is the distribution of the PERA assets upon Contributor’s:
● Reaching the age of 55 and made Qualified Contributions for at least 5
years (non- consecutive)
● Death, irrespective of the age of the Contributor or yearly Contributions
made

14. What is the penalty for an early withdrawal of PERA?

In case the Contributor withdraws from PERA prior to reaching 55 years old or 5
yearly contributions, the Contributor shall pay the following early withdrawal
penalties:

BPI Asset Management and Trust Corporation (BPI AMTC) is a subsidiary of the Bank of the Philippine Islands. For any inquiries and
complaints relating to our services and product, you may call us at (02) 8580-AMTC (2682), send an email
to [email protected], or write a letter addressed to BPI Asset Management and Trust Corporation - Consumer
Protection, 7/F BPI Buendia Center, Sen. Gil J. Puyat Avenue, Makati City 1209.

BPI AMTC as Trustee and Investment Manager is regulated by the Bangko Sentral ng Pilipinas with email
address [email protected].
 ● The five percent (5%) tax credit availed by the Contributor for the entire
period of PERA;
● A flat rate of twenty percent (20%) based on the total income earned by
said account from the time of its opening/creation up to the time of
withdrawal.

15. Are there exemptions from early withdrawal penalties?

Yes, the following situations will not be subject to Early Withdrawal Penalty:
● Immediate transfer of proceeds to another Qualified/Eligible PERA
investment Product and/or another Administrator within 2 working
days from the withdrawal
● For payment of accident or illness-related hospitalization in excess of
thirty (30) days – needs a duly notarized doctor’s certificate
For payment to a Contributor who has been subsequently rendered permanently
totally disabled as defined under the Employees Compensation Law or Social
Security System Law – needs certification from pertinent government agency

II. BPI PERA

16. What are the available BPI PERA products?
We are offering four (4) BPI PERA UITFs namely:
● BPI PERA Money Market Fund – a money market fund
● BPI PERA Government Bond Fund – a bond fund
● BPI PERA Corporate Income Fund – a balanced fund
● BPI PERA Equity Fund – an equity fund.

The BPI PERA Money Market Fund and the BPI PERA Government Bond Fund are
for clients with at least a moderate risk profile while the BPI PERA Corporate Income
Fund and the BPI PERA Equity Fund are for clients with an aggressive risk profile.

17. How much do I need to invest in the BPI PERA UITFs?

Clients can open a PERA and invest in the BPI PERA UITFs for as low as PHP 1,000
(exclusive of fees).

BPI Asset Management and Trust Corporation (BPI AMTC) is a subsidiary of the Bank of the Philippine Islands. For any inquiries and
complaints relating to our services and product, you may call us at (02) 8580-AMTC (2682), send an email
to [email protected], or write a letter addressed to BPI Asset Management and Trust Corporation - Consumer
Protection, 7/F BPI Buendia Center, Sen. Gil J. Puyat Avenue, Makati City 1209.

BPI AMTC as Trustee and Investment Manager is regulated by the Bangko Sentral ng Pilipinas with email
address [email protected].
 18. What do I need to open a BPI PERA?
● A BPI savings or checking account to serve as a settlement account.
● A valid government ID
● A Tax Identification Number (TIN)
● A copy of the Income Tax Return or any document that can validate the
TIN.
● IDs of Beneficiaries (if any)

19. What are the additional requirements for an OF?

● Overseas Employment Certificate issued by the Philippine Overseas
Employment Administration (POEA)
● Any official document showing that he will earn or has earned income
in a foreign country in the year of the PERA contribution.

20. What are the additional requirements for an individual who has retained or
reacquired his Philippine citizenship under RA 9225 or the Citizenship
Retention and Reacquisition Act of 2003?
● Identification certificate issued by the Bureau of Immigration, to prove his
reacquisition of Philippine citizenship
● Any official document showing that he will earn or has earned income in a
foreign country in the year of the PERA contribution.

21. What if the OF cannot open a PERA, can his/her spouse open a PERA in
his/her behalf?
Yes, if an OF cannot open a PERA, the spouse can open a PERA in the OFs
behalf, with the OF’s consent and must submit the following:

● Marriage certificate attesting marriage with the OF.

● Sworn certification that the spouse is opening a PERA for and in behalf
of the OF who has not availed of the benefits under the PERA Act
● Supporting documents attesting OF status (POEA Overseas
Employment Certificate and official documents showing income
earned or will be earning in a foreign country).

BPI Asset Management and Trust Corporation (BPI AMTC) is a subsidiary of the Bank of the Philippine Islands. For any inquiries and
complaints relating to our services and product, you may call us at (02) 8580-AMTC (2682), send an email
to [email protected], or write a letter addressed to BPI Asset Management and Trust Corporation - Consumer
Protection, 7/F BPI Buendia Center, Sen. Gil J. Puyat Avenue, Makati City 1209.

BPI AMTC as Trustee and Investment Manager is regulated by the Bangko Sentral ng Pilipinas with email
address [email protected].
 22. What if the OF cannot open a PERA, can his/her child open a PERA in his/her
behalf?
Yes, if an OF cannot open a PERA, his/her child can open a PERA in the OFs
behalf, with the OF’s consent and must submit the following:

● The birth certificate attesting that he/she is the child of the OF

● Sworn certification that the child is opening a PERA for and in behalf of the OF
who has not availed of the benefits under the PERA Act, or the spouse of the
OF has not availed of the benefits under the PERA Act
● Supporting documents attesting OF status (POEA Overseas Employment
Certificate and official documents showing income earned or will be earning
in a foreign country).

23. How will I get my tax credit of 5%?

The Certification of Entitlement to 5% Tax Credit for Employee-Contributor or
the PERA Tax Credit Certificate (TCC) will be released to the PERA
Administrator who will in turn transmit it to the PERA Contributor. The BIR has
yet to issue a detailed procedure on the processing and utilization of the tax
credit.

24. What are the fees that are related to PERA?

For BPI as PERA Administrator, we have an administrator’s fee of one percent
(1%) of the amount contributed. This is to compensate the PERA Administrator
for servicing the PERA account of the Contributor which includes the
submission of reports. There are also transactional and annual fees from the
Cash Custodian as well as trust fees from the respective PERA UITFs. The
accredited PERA Individual Administrator will explain all the related fees to
PERA.

BPI Asset Management and Trust Corporation (BPI AMTC) is a subsidiary of the Bank of the Philippine Islands. For any inquiries and
complaints relating to our services and product, you may call us at (02) 8580-AMTC (2682), send an email
to [email protected], or write a letter addressed to BPI Asset Management and Trust Corporation - Consumer
Protection, 7/F BPI Buendia Center, Sen. Gil J. Puyat Avenue, Makati City 1209.

BPI AMTC as Trustee and Investment Manager is regulated by the Bangko Sentral ng Pilipinas with email
address [email protected].